Antecedents of the income tax in colonial America

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The Accounting Historians Journal Vol. 10, No. 2 Fall 1983
Robert M. Kozub
UNIVERSITY OF WISCONSIN-MILWAUKEE
ANTECEDENTS OF THE INCOME TAX IN COLONIAL AMERICA
Abstract: One of the goals of the present federal income tax system is to tax in-dividuals to the extent of their ability to pay. This concept of vertical equity did not originate in the current century. Analysis of the tax laws of the American colonies results in the conclusion that our colonial forefathers attempted to mea-sure the faculty or ability of individuals when enacting tax legislation. This paper analyzes the varied historic forms of the test to measure the capacity to bear the burden of taxation."
Taxation, it is said, is a hateful process in the eyes of mankind.1 However, every government must provide for its general expenses and the cost of other public necessities by means of taxation. Rec-ognition that the organization of society into a state necessitates taxation is found within the words of Sir Edwin Sandys, the moving spirit behind the Virginia Company: "The maintaining of the publick in all estates being of no less importance even for the benefit of the private, than the root and body of a tree are to the particular branches."2
Yet each social class has endeavored, amidst the clashing of greatly divergent interests, to shift the burden of taxation upon other classes. One must analyze the economic development of the Ameri-can colonies in order to trace the development of taxation and the evolution of the principle of faculty or ability to pay, the principle that individuals should be required to bear the financial burden of the government in proportion to their ability to help themselves. As the economy of the colonies developed, the historic forms of the test of the faculty to bear the public burden also evolved. This paper traces the development of the attempts to measure the pre-sumed capacity of individuals to bear this burden. A survey of the origins and evolution of colonial taxes entails a survey of the man-
*ln quoting from early documents, the author has consciously elected not to note spellings which differs from present form. Such notation would have adverse-ly affected the readability of the quotes and the paper in general due to the fre-quency of these differences.